On a national level, large-scale real estate projects started in the first part or in the middle of the year are worth around €4 billion, according to public data analyzed by ONV LAW. These are in various stages of development, some nearing completion or with delivery dates for the first half of 2023.
Even if the real estate sector is going through a period with many challenges, due to high energy prices or lack of construction materials, investors have quickly adapted to the current socio-economic situation, so many segments are still developing.
According to ONV LAW’s analysis, real estate developers are now offering longer delivery times and are moving towards affordable materials.
Projects with a value of €3 billion are also funded from the state budget at the end of the year and will probably continue in the first half of 2023. Most investments consist of road infrastructure, modernization of buildings or public institutions.
At the same time, the largest residential projects currently amount to approximately €100 million. Such investments are made in developed cities such as Cluj-Napoca, Timisoara, Sibiu, Bucharest or Constanta.
Moreover, there are real estate developers who operate in Romania and have expansion plans in some European countries.
Accelerated investments in industrial and logistics
The most effervescent sector still remains that of industrial and logistics spaces. The demand for these spaces remains high after the pandemic, and the projects that have delivery dates in the coming months, amount to investments of over €500 million.
Most of the projects are investments with foreign capital, and most of them are developed in the western counties of the country.
“Demand is still high in real estate, which is probably the safest investment in times of economic uncertainty, but there is also an area of unpredictability for investors right now in the market. In this context, the suspension of the sector PUZs and, subsequently, the cancellation of the PUZs of sectors 3, 5 and 6 led to major blockages of real estate investments at the level of the Capital City, which had a negative financial impact on both for developers and for the local budget. Moreover, the cancellation in the first instance of the current General Urban Plan and the authorities’ estimate that the development of the new PUG could take another three years, constitutes a new element of uncertainty in the real estate sector in Bucharest”, commented Sînziana Bărbieru, ONV LAW partner.
The latest public statistics show that, at the end of the second quarter of the year, real estate investments increased by 4.1 percent, compared to the same period last year. The accelerated pace moderated in September, compared to the previous month. The number of building permits for residential buildings decreased by 4 percent, but that of non-residential buildings increased by 1.1 percent.
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